UBS raises Amer Sports stock price target to $50

On Wednesday, UBS analyst Jay Sole updated Amer Sports Inc. (NYSE:AS) with an increased price target, now set at $50.00, up from the previous target of $37.00. The firm continues to endorse a Buy rating on the company’s shares. The stock, currently trading at $37.37, sits near its 52-week high of $37.99, having delivered an impressive 153% return over the past year. According to InvestingPro data, the company maintains a "GOOD" financial health score.

Sole supports the optimistic outlook on Amer Sports, recognizing it as a growth stock, despite the market’s reservations about the company’s expansion possibilities, particularly due to its significant exposure to the Chinese market in a tough consumer climate and prevailing global macroeconomic uncertainties. Recent performance supports this optimism, with revenue growing 21.38% in the last twelve months and the company maintaining healthy liquidity with a current ratio of 1.66.

UBS forecasts a 17% sales growth for Amer Sports over the next twelve months (NTM) and anticipates a 30% compound annual growth rate (CAGR) in earnings per share (EPS) over the next five years, through the fiscal year 2029 estimates (FY29E). Sole believes that such growth rates warrant a higher price-to-earnings (P/E) ratio, suggesting that as the company’s growth potential becomes more evident, the market sentiment towards the stock is likely to improve.

The revised $50 price target is based on a 40 times multiple of UBS’s $1.25 EPS estimate for the fiscal year 2027 (FY27). The analysis indicates a favorable risk-reward balance, with a projected upside/downside skew of 2.5:1, suggesting more potential for price appreciation than decline. Currently trading at a P/E ratio of 82.58, InvestingPro analysis suggests the stock is overvalued relative to its Fair Value. Discover comprehensive valuation metrics and 18 additional ProTips for Amer Sports in the full Pro Research Report, available exclusively to subscribers.

In other recent news, Amer Sports Inc. reported a strong first-quarter performance, exceeding expectations with revenue and adjusted EBITDA surpassing analyst projections by 6% and 30%, respectively. The company’s direct-to-consumer and China segments experienced significant growth, with increases of 39% and 43%. Following these results, Amer Sports raised its full-year guidance, now anticipating revenue growth of 15-17% and earnings per share (EPS) in the range of $0.67 to $0.72. Several analyst firms have responded to these developments by adjusting their price targets for Amer Sports. UBS raised its price target to $50, maintaining a Buy rating, while Baird increased its target to $44, citing the company’s strong growth potential. Bernstein SocGen Group lifted its target to $43, emphasizing the robust performance across all business segments and regions. Morgan Stanley (NYSE:MS) also adjusted its target to $33, although it retained an Equalweight rating, reflecting a cautious stance. Evercore ISI increased its target to $43, highlighting the strength in the Technical Apparel division, particularly the Arc’teryx brand. These adjustments underscore the confidence in Amer Sports’ continued growth trajectory.

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